IRS audit revenue plunged following mass layoffs, watchdog finds
IRS audits collected $3.5 billion less in fiscal 2025 as the agency shed thousands of auditors and other agency staffers.
The Treasury Inspector General for Tax Administration (TIGTA) reported that IRS audit revenue plunged 35% in fiscal 2025 due to mass layoffs, with the agency collecting $6.5 billion from audits, down from $10 billion the previous year. The number of IRS employees working in auditing and collections dropped to 17,517 as of January 2026, a decline of nearly 10,000 workers from fiscal 2024.
TIGTA expressed concern that the staffing reductions may have a lasting impact on the IRS's ability to enforce tax laws and improve taxpayer service.
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